HOME APPLIANCES: Warmer weather than normal hurt heater sales last quarter, reducing revenue, but the company said the drop was in line with its expectations

By Camaron Kao  From Taipei Times

Airmate (Cayman) International Co (艾美特), which makes electrical fans, heaters and home appliances, yesterday said that it has set a goal of revenue growth of between 5 percent and 10 percent this year from a year ago, despite a 5.63 percent drop in sales last quarter.

The company posted revenue of NT$2.82 billion (US$93.55 million) last quarter, down from NT$2.99 billion a year ago, because of a relatively warm winter, which depressed heater sales, manager Yasung Chuang (莊亞菘) said at an investors’ conference in Taipei.

The figure was 8.05 percent higher than the NT$2.61 billion earned the previous quarter.

“We face similar weather conditions every three or four years, and the decline was in line with our expectations,” she said.

Chuang said the company’s revenue this quarter would remain flat from the previous quarter, but rise significantly starting in the second half of this year as shipments of small home appliances, such as blenders, increase.

The company aims to raise the percentage of sales of small home appliances to between 15 percent and 20 percent this year from 6 percent last year, with those of air purifiers rising to 150,000 units this year from less than 40,000 units last year thanks to the severe air pollution in China, she said.

The company is also planning to increase its number of stores in China to 1,000 by the end of this year, from 600 at the end of last year.

Last year, Airmate posted revenue of NT$12.98 billion, up 12.09 percent from NT$11.58 billion in 2012.

Sales in China accounted for 50.31 percent of overall revenue last year, while Northeast Asian countries accounted for 35.26 percent, the company said.

It reported profit of NT$611.64 million, or NT$5.08 per share, last year, up 34.95 percent from NT$453.23 million, or NT$4.76 per share, in 2012.

That will allow the company to distribute a cash dividend of NT$2.55 per share, up from NT$2.5 last year, Chuang said.

Airmate plans to issue five-year convertible bonds to raise NT$1.3 billion next quarter to pay the cash dividend and finance its capital expenditure this year, she said.

The company will spend US$35 million this year to refurbish a plant in Jiujiang, Jiangxi Province, China, Chuang said, adding that the project will be completed in October.

The new plant is to boost the company’s capacity to 50 million units a year from 20 million units.

The company will pay 120 million yuan (US$19.29 million) a year from 2017 through 2019 to purchase more factories and land, she added.

The company’s shares rose 0.13 percent to NT$79 in Taipei trading yesterday, underperforming the TAIEX, which was up 0.67 percent.

For more on this story go to: http://www.taipeitimes.com/News/biz/archives/2014/04/16/2003588109